Are Drugs for Ultra-Rare Diseases the Future of Biotech?

Over the last ten years, the global pharmaceutical industry has undergone dramatic changes. In the 1990s, big drug companies made hundreds of billions of dollars selling slightly improved versions of their competitors’ drugs; think of the epic battle between cholesterol-lowering drugs Lipitor and Zocor. Since then, however, an entirely new business model has emerged: developing drugs for rare, or “orphan” diseases, which are far easier to get through the FDA, and for which companies can charge significantly higher prices. The latest entry into the field is NPS Pharmaceuticals’ Gattex, which was approved last December for the treatment of short bowel syndrome.